Alibaba’s Jack Ma: Better-Than-Ever Fakes Worsen Piracy War

Improving quality of counterfeits compounds the problem

Alibaba Group Holding Ltd. founder Jack Ma said Chinese-made counterfeit goods today have gotten better than the genuine article, complicating the effort to root out fakes on the country’s largest online shopping services.

Global brands have long relied on China and other low-cost manufacturing bases to beef up margins. But those same factories have gotten savvier over the years and are now using the Internet — including Alibaba’s platforms — to sell their own products straight to consumers, Ma told the company’s investor conference on Tuesday. Still, Alibaba is the best in the world at fighting the sale of counterfeits, he added.

“The problem is that the fake products today, they make better quality, better prices than the real products, the real names,” Ma said in Hangzhou, China. “It’s not the fake products that destroy them, it’s the new business models.”

“The exact factories, the exact raw materials, but they do not use their names.”